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The Tale of Code-Based Incentives: Incentivizing Attainable Housing Through Density Increases

October 6, 2022 Real Estate Real Estate Blog

On September 19, 2022, the Sarasota City Commission voted to approve Ordinance No. 22-5439 on first reading. The ordinance is one of several that would make changes to the City’s Comprehensive Plan.

What does the ordinance do?

  1. Modifies the Urban Edge, Downtown Core, and Downtown Bayfront districts to allow for increases in residential density over existing base density when a portion of the additional residential units provided are defined as “attainable.”
  2. Caps the total maximum density at no greater than 4 times the base density (this would likely mean a maximum of 100 units per acre in Urban Edge, and a maximum of 200 units per acre in both Downtown Core and Downtown Bayfront).

Why is this important? If owners in the impacted districts choose to redevelop their properties and include attainable housing, it will allow them to add more residential units than what was previously permitted, and therefore increase the value of their properties. This will also encourage smaller, and more affordable, housing units.

What are the boundaries? Generally it includes everything from the Bay east to Lime Avenue, and from 10th Street south to Mound Street, although it excludes Laurel Park, most of Gillespie Park, and most of Park East (see the locations of Urban Edge, Downtown Core, and Downtown Bayfront on the City of Sarasota Future Land Use Map).

What is “attainable”?   The City’s Comprehensive Plan defines attainable housing units as affordable to households earning 60 to 120 percent of the Area Median Income (AMI). The density bonus will also be applicable for households earning below 60 percent of the AMI.

Is the ordinance effective now? No, the ordinance must be considered by the City Commission once more on October 17, 2022, and if passed on second reading, it will then become effective.

When can the density increase be utilized in development? Assuming the ordinance passes, it will then be necessary for the City to amend the zoning code to implement the density increases.

Update: On October 17, 2022, the Sarasota City Commission voted to approve Ordinance No. 22-5439 on second reading. This was the final step in amending the City’s Comprehensive Plan to allow for density increases of up to four times the base density in certain land use classifications, in exchange for attainable housing. Next, the City will have to make amendments to its zoning code to implement these changes before they can be utilized in development.